Related Insights

The next wave of disruption and productivity improvements is upon us, and that means opportunity for the digital enterprise — if you are following the right roadmap. Our six technology trends are critical guideposts for innovation on your digital transformation journey.

1. Re-platforming the enterprise

In 2018, we’ll see an aggressive move to common IT platforms so companies can respond to market changes faster, be more productive and make better-informed decisions. These common platforms are rich in analytics, follow the information flow of the business and are simple enough that users can constantly change the business without writing (much) code. Moreover, they bring an operational and evergreen scale to traditionally bespoke enterprise IT.

These common platforms — from Amazon, Microsoft, Google and others — provide very suitable if not substantially improved replacements for what used to be custom builds.

“This is about the technology you need, not the technology you make,” emphasizes Dan Hushon, CTO of DXC Technology.

Common platforms enable companies to shift their customization efforts from infrastructure to applications and the user experience, which is where the action is.

Another bonus: Moving to common platforms frees up talent and working capital for differentiated services — where differentiation comes from the information you provide in context to customers, partners and employees for new and better outcomes and experiences.

Platforms will provide not only a foundation to improve processes, but also telemetry and insights. For smart adopters, we may see twofold to fivefold business acceleration.

2. The war for digital talent is vigorous and creative

Re-platforming the enterprise portends a major shift in talent, from operating computers to using multiple skills for information integration, analytics and governance.

These digital skills are incredibly scarce and demand is high. Companies will be fighting for people with digital skills to make the transition to common platforms and to drive disruptive change. So how can we get increased scale from a finite talent pool? And how do we maximize the productivity of the talent we already have?

The quick answer? We’ll use common platforms and a concentrated partner strategy to source experienced talent.

Incubators — creating or sponsoring organizations or spaces that support startups

Strategic acquihires — buying entire companies for their talent

Talent will decide who wins and loses in the next decade.

3. Quantified enterprise: Stop guessing and start measuring

Last year we predicted the rise of intelligent machines. We got that right; today business decision makers say artificial intelligence (AI) is pivotal to their organization’s future success. In 2018, companies will harness the “data exhaust” from their digital systems to quantify the business and become even more productive. This quantification will emerge as a primary driver of digital transformation.

Forced to rethink big data, companies will use advanced machine learning to make better decisions with less data. Call it: “The rise of intelligent decision making.”

The best companies are over 40 percent more productive than their peers — leading to operating margins 30 to 50 percent higher. So the potential benefits are huge.When it comes to determining what affects productivity, companies will stop guessing and start measuring. They’ll start shifting from making decisions based mostly on stories and gut feelings, to making decisions based on experiments and measured results.

The first opportunities will be the often-dysfunctional business processes that bring so much friction to productivity and revenue realization.

4. Businesses get stronger through cyber resilience

In the past, companies tried to create perfect security, but today security is viewed not as binary but as a continuum. In 2018, enterprises will focus on getting their resilience as high as possible to withstand attacks and threats. That means planning and practicing for such threats, because they will happen. The common practice will be continuous evaluation and improvement of risk posture.

Added to resiliency is the notion of antifragility, which means getting stronger when attacks happen — not just surviving the attack. You get stronger from practicing and responding. You use what you’ve learned to make yourself stronger the next time around.

With the many destabilizers facing enterprises today — cyber attacks, natural disasters, vendor failures, human error, mergers and acquisitions — enterprises must work to become ever-more resilient by applying continuous improvement to productivity, differentiation and the resiliency of the business itself.

5. Companies grow through digital business extensions

The digital core will provide enterprises with an information-rich, scalable foundation. In 2018, companies will grow by leveraging that information and scale, extending their digital capabilities into every facet of the organization — as well as into new markets and new businesses — through digital business extensions.

Amazon’s journey – from online bookseller to online-everything marketplace, to cloud platform, to online- and offline-everything platform, including groceries – is not about a company being irrationally greedy and trying to put a finger in every pie. It is a story of smart digital extensions. In other words, Amazon can run some of those businesses better because of its digital capabilities.

GE’s big plans for the industrial internet of things and its Predix platform can also be seen as a digital business extension.

To make the right digital extensions, companies need a “strategic backflow” from digital capabilities to corporate strategy. This backflow must be embedded in strategic planning rather than based on heroic behaviors, water cooler conversations and special relationships.

That means ensuring that corporate strategy and, ideally, all functional strategies (e.g., marketing, manufacturing, logistics) have mechanisms to consider digital extensions. Ask: “What can I do now?” and “What should I do next?”

Let’s let the digital tail wag the corporate dog, at least a little, in 2018 and beyond.

6. Artificial intelligence gets smarter and more practical

For all of these technology trends, artificial intelligence (AI) will determine the long-term winners and losers. In the past, people were not building AI with the right goals in mind, but that will change in 2018 as companies become more information-driven and use neural networks for continuous learning and productivity.

A big bastion of AI deployment is IoT, because it generates so much information. Other rich areas for AI advances include employee information systems and processes, clinical health advisement systems and IT service management (managing millions of computers is untenable for humans).

Convolutional Neural Networks (CNNs), a class of artificial neural networks, will evolve and trigger an explosion of opportunities: